European multinationals attack minimum wage in Vietnam

The General Secretary of the European Trade Union Confederation (ETUC), Mr John Monks has described as “totally unacceptable” the position of the European Chamber of Commerce in Vietnam (EuroCham) threatening withdrawal of European investment in the country if minimum wages are raised. The General Secretary of the International Trade Union Confederation (ITUC) Ms Sharan Burrow has described EuroCham’s intervention as “offensive”.

Mr Monks said that the ETUC expected European companies to contribute to decent work and sustainable development in their host countries. He pointed out that the European Union (EU) had consistently pressed for sustainable development chapters to be included in Free Trade Agreements (FTA) with third countries in line with those objectives. The EU is planning to engage in negotiations with Vietnam on such an FTA. In a letter to EU Trade Commissioner Karel De Gucht, he asked the European Commission to ask EuroCham, which the ETUC understood received support from the Commission, “to desist from making such statements which can only undermine the development of proper trade relations with Vietnam”.

Ms Burrow described the Eurocham’s position as “an offensive intervention in Vietnam’s wage-setting, at a time when many foreign companies are actually finding it hard to attract workers due to the low wages they offer. European companies should not be trying to export poverty wages to Vietnam or anywhere else – decent incomes are central to economic growth and development.”

On learning of the situation, Global March Chairperson Kailash Satyarthi expressed full support for the ETUC letter and for the comments of the ITUC: “In all our processes of dialogue with multinational companies and key actors in trade development, we emphasise the importance of decent work and education in tackling the incidence of child labour. Vietnam is a country which has a child labour problem and threats such as those of EuroCham are inevitably going to create a situation of fear and confusion for the Vietnamese government, social partners and people – all of which could exacerbate the child labour problem. It is highly irresponsible of EuroCham and we urge these comments to be withdrawn immediately.”